A web site for $5 a month?

Stone Tapes continues to challenge some of our naive assumptions about the way the Web works.

 

Perhaps the biggest myth on the Web is that if you build a better site then the world will beat a path to your door.

If you have anything to do with creating information-based web sites - that is web sites that don't sell something or act as the portal to a commercial concern - then you will already know this as a fact. If on the other hand you have a really good idea for a blog, or an online publishing venture of any sort for pursuing personal passions, you may well not be aware of it given the hype that surrounds the humble blog.

 

stonetapes.

 

It is amazing how often I get into conversation in a bar with some enthusiastic person planning to make a fortune, or at least gain credibility, from some blog or other. It is almost an urban myth that the web is democratising publishing in ways that the dying old guard just don't get.

The idea goes that you write something amazing and in no time at all search engines direct lots of traffic to your site. Then users tell other users and in no time at all it's a viral explosion.

This rarely happens.

In fact it happens so rarely that you can base a business plan on it. If you look at almost any popular hosting company they offer to provide the facilities you need to keep your website on-line and running for 99.9% of the time 24/7 and 52 weeks of the year  for as little as $5 a month - perhaps less with a special offer.

How can they do it?

How can they sell you a slice of their server farm and bandwidth not to mention support, backup and other services? What is even more amazing is that they often state that you can use as much bandwidth as you like - no cap, no throttling, really unlimited bandwith.Most ISPs can't match this sort of deal for ten times the price.

 

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The answers to these questions and the resolution of the anomaly  should be obvious to you if you think about it for a moment. The simple answer is that they are selling the average website owner virtually nothing. The slice of the server farm and bandwidth that $5 per month is buying is next to nothing - these are web servers sliced as thinly as they can go.

Notice that I'm not suggesting that there is anything dishonest in what the hosting services are providing. Far from it. They fill a need and service a demand that is real and they do it at a sensible price and provide a potential spawning ground for really good ideas created by amateurs who can't afford to invest more. What is interesting is what their business model is saying about the average website - and this is realistic.

Most websites don't get any traffic worth having. Start a blog about something that you and even a substantial niche audience are really interested in and you will be lucky to see 100 real visitors in a week and no this won't increase much week-on-week. The reason is that your website will remain buried on the 1000th page of the search engines results. No one  will know about it and that's the way things will remain for a long time.

This means that any web hosting service can offer to host your site for next to nothing because they can cram lots of virtual sites on a single server and still not use more than a few percent of its bandwidth or processing power. It is the company's basic assumption that the majority of websites that it hosts for such low monthly fees will rarely be accessed.

If you hang in there and keep blogging, with virtually no one reading your blog, then one day you may have a following that makes the activity worth it. When this happens the hosting company will, of course, tell you that they cannot host your site on shared virtual server any more because its success is degrading the performance for all the other low-budget websites. If you want to continue then you will have to upgrade to something more costly - a virtual server of your own or perhaps a dedicated server. 

Again this is not unreasonable behavior and I'm not telling you about it to bring shame to the hosting companies - it is very reasonable behavior based on the life cycle characteristics of a typical website.

So what conclusions can we draw?

  • In a world where everyone blogs - most blogs aren't read by anyone.
  • In a world where information comes by the bucket load most of it is still sitting in the lake never to make it into the bucket.
  • Search engines aren't particularly efficient at detecting new worthy information - it mostly stays buried.
  • If you are thinking of starting a blog, niche information provider or emagazine then it is reasonable to use a $5 a month hosting service as for the first year or two it won't be getting enough traffic to justify anything more.

You might find this all very depressing, but it isn't an opinion - it is burned into the business plans of a great many hosting companies. And you know that finance never lies.

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Last Updated ( Tuesday, 01 February 2011 )
 
 

   
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